Unlocking retail growth: The power of embedded insurance and financial products for retailers.

Unlocking Retail Growth: The Power of Embedded Insurance and Finance

In the rapidly changing world of retail, businesses need to find new ways of engaging with their customers, enhancing their user experiences, and driving growth.

Today, some of the most powerful tools available to retailers are embedded insurance and embedded finance, which integrate services like warranties and payment plans directly into the customer journey.

In this article, we’ll explore how these solutions can increase revenue, improve profitability, and provide a seamless experience for customers.

 

The Evolving Retail Landscape

In 2024, the retail industry is much more than just selling products; it’s about providing a complete experience that meets the evolving needs of customers.

Shoppers today expect more than just a product—they want flexible payment options that can be catered to their needs and steadfast protection for their purchases. That’s where embedded insurance and finance come in.

By offering options like extended warranties and financing directly at the point of sale, retailers can give customers greater peace of mind and remove barriers to purchasing higher-value items. This not only improves customer satisfaction but also drives larger transactions and builds loyalty.

What are Embedded Insurance and Embedded Finance?

Embedded insurance and finance are tools that can be integrated into online buying journeys to ensure that customers can stay on one platform to complete their purchases instead of being sent to less reliable third-party providers to complete the process.

Using embedded insurance and embedded finance allows retailers to offer warranties, insurance, or flexible payment options right in the shopping journey. This makes it easy for customers to protect their purchases or spread-out payments over time, creating a seamless, friction-free experience.

For example:

Embedded insurance: Offers protection like extended warranties that cover accidental damage or breakdowns.

Embedded finance: Includes payment plans or buy-now-pay-later options, which make higher-ticket items more accessible to a broader audience, ultimately boosting sales.

At Stubben Edge, we help retailers integrate these solutions into their websites or apps quickly and efficiently, enabling them to provide a better overall shopping experience.

How Embedded Solutions Drive Revenue Growth

Offering embedded finance and insurance can really impact a retailer’s bottom line, making it a hugely attractive option for so many business owners.

But how do embedded solutions actually improve business revenue?

Increased average order value (AOV): When customers have the option to protect their purchase or pay in instalments, they’re more likely to spend more on higher-priced items.

Improved conversion rates: Flexible payment options make expensive purchases feel more manageable, which helps convert more browsers into buyers.

Cross-selling opportunities: Offering warranties or related services at checkout can increase the value of each transaction.

These integrated solutions help retailers unlock new revenue streams by turning routine transactions into opportunities for additional sales that wouldn’t otherwise take place.

Enhancing Profitability

In addition to boosting sales, embedded solutions can also improve a retailer’s overall profitability offering various advantages, such as:

Higher margins: Warranties and finance options often come with higher margins than standard retail items, adding to overall profitability.

Fewer returns: Customers who purchase protection plans or use financing tend to feel more secure about their purchase, resulting in fewer returns and exchanges.

Ongoing revenue: Extended warranties and protection plans often lead to recurring revenue, as customers renew their coverage over time.

By offering these high-margin services, retailers can improve their profit margins while creating longer-lasting relationships with their customers.

Expanding the Customer Base

Embedded insurance and finance can help retailers reach new customers by making products more affordable and improving the shopping experience.

By offering flexible payment options and protection plans, retailers can attract a broader audience, build customer trust, and encourage repeat business through:

Increased accessibility: Flexible payment options make higher-value items more affordable to a broader range of customers, expanding their potential market.

Loyalty and trust: Offering warranties or financing helps build trust with customers, encouraging them to come back for future purchases.

Better customer experience: An integrated shopping experience that includes protection and financing options makes customers feel looked after, leading to positive reviews and word-of-mouth recommendations.

These solutions help retailers attract more customers, keep them satisfied, and encourage them to return in the future.

Seamless Integration: The Complete User Journey

Stubben Edge provides retailers with the ability to seamlessly integrate these services into their existing digital platforms.

Using our technology, we can help retailers build the entire customer journey—from browsing products to selecting insurance or financing options—directly into their website or app.

With our end-to-end journey approach, customers can shop, select their products, and add warranties or choose financing all in one place. This creates a smooth, uninterrupted experience that encourages more conversions.

We also provide regulatory support to help retailers become Appointed Representatives (ARs). Giving our customers the right regulatory permissions enables them to manage insurance and finance services without the complexity of handling compliance themselves.

Overall, we help retailers provide an improved customer experience. Each retailer’s platform is customised to meet the specific needs of their business and customers, ensuring the right services are offered at the right moments in the purchase journey.

This holistic approach allows retailers to offer a seamless experience that adds value to both their customers and their business.

Case Studies: How Embedded Solutions Have Driven Success

eCommerce platforms: Protection That Drives Sales

A major motoring platform that connects consumers with thousands of product sellers wanted to stand out in a highly competitive market. We worked with them to create a warranty that offers protection for defects, accidental damage, and theft, covering motors up to a significant value.

This guarantee has boosted seller confidence, leading to an increase in sales and new seller sign-ups. We expect over 100,000 vehicles to be sold under this guarantee in the coming months.

Stubben Edge’s role:

We handled all the back-end processes and claims, allowing the motoring platform to focus on growing its network and customer base.

Furniture Retailers: Success with Embedded Warranties

We’ve partnered with two national high street and online retailers to help them offer extended warranties to over 1 million customers combined.

This has led to a higher average order value, as offering warranties increases customer confidence, resulting in larger purchases.

Both retailers have also strengthened customer loyalty by providing protection plans, which have fostered greater trust and driven higher rates of repeat business.

Additionally, the warranties have generated significant recurring revenue as customers continue to renew their coverage over time.

These partnerships demonstrate how embedded insurance can drive sales growth, build loyalty, and create long-term revenue streams for retailers.

Conclusion: Driving Growth with Embedded Solutions

Embedded insurance and finance aren’t just about adding extra services, they’re about unlocking growth opportunities for retailers.

By integrating these solutions into their sales process, retailers can increase revenue, improve profit margins, and enhance customer satisfaction—and Stubben Edge is here to help retailers do just that.

With our innovative technology and regulatory support, we can help retailers small and large offer embedded services that can transform their business.

So, if you’re ready to explore how embedded finance and insurance can drive growth for your business, get in touch with us today.

Jason Smith – Chief Commercial Officer

E: jason.smith@stubbenedge.com 

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